European Stocks Edge Higher; Volkswagen Slips on Chip Worries

This post was originally published on this site
https://i-invdn-com.akamaized.net/news/LYNXMPEE7024E_M.jpg

Investing.com – European stock markets edged higher Monday, continuing the global rally as investors gear up for a busy week of earnings and economic data, with a Federal Reserve meeting also thrown in. 

At 3:50 AM ET (0850 GMT), the DAX in Germany traded 0.4% higher, the CAC 40 in France rose 0.3% and the U.K.’s FTSE 100 climbed 0.2%.

Global stocks markets have been lifted to record levels by signs of a global economic improvement, typified by the early April manufacturing activity indicators out last week, with purchasing manager indices hitting record highs in the United States and signaling an end to a double dip recession in Europe

Germany’s highly-watched Ifo Business Climate Index continued the trend for improved sentiment, climbing to 96.8 in April, above the 96.6 level seen in March, although this jump wasn’t as impressive as had been expected.

More concrete economic data comes in the form of the first-quarter U.S. gross domestic product numbers later in the week amid expectations activity is fast returning to pre-pandemic levels.

Also of interest will be the latest policy-setting meeting of the Federal Reserve, which concludes on Wednesday. Fed Chairman Jerome Powell is not expected to announce any policy changes, but is likely to face questions over whether an improving labor market and rising coronavirus vaccinations warrant a withdrawal of monetary easing. 

Back in Europe, Volkswagen (DE:VOWG_p) stock slipped 2.5% after the Financial Times reported the company was warning about a bigger production hit in the second quarter due to a global chip shortage.

Philips (AS:PHG) stock fell 2.6% after the Dutch health technology company booked a provision of up to 250 million euros ($302 million) from a possible safety risk in some sleep and respiratory care products, even while posting a 74% jump in quarterly core earnings and raised its outlook for 2021.

On the flip side, Pearson (LON:PSON) stock rose after strong growth in online education helped the U.K. publishing giant lift revenues by 5% in the first three months of 2021, while IMI (LON:IMI) stock soared 7% after the U.K. engineering firm lifted its full-year guidance and launched a stock buyback program.

A lot of corporate attention this week will be on the U.S. tech giants, with Tesla (NASDAQ:TSLA), Facebook (NASDAQ:FB), Microsoft (NASDAQ:MSFT) and Apple (NASDAQ:AAPL) among the companies due to release their earnings.

Oil prices weakened on continued concerns that rising numbers of Covid-19 cases in India and Japan, the third and fourth largest crude importers in the world respectively, will hit demand for the product in Asia.

U.S. crude futures traded 0.9% lower at $61.56 a barrel, while the Brent contract fell 1% to $64.80. Both contracts fell around 1% last week.

Elsewhere, gold futures were up 0.1% at $1,778.70/oz, while EUR/USD traded largely flat at 1.2096.